Personalized Marketing: 3 Tips For Getting It Right

Erica Vialardi

Did you know that some of today’s most famous digital innovators share a very specific and unexpected aspect of their life stories? This was a bit of a revelation to me, and I feel it sheds some light on the relationship between consumer behavior, technology, and 21st-century marketing strategies.

From wooden learning towers to digital disruption

During a presentation about co-design that I attended some months ago, there was a genuine “wow” moment when the speaker unveiled that Larry Page, Jimmy Wales, and Jeff Bezos, to name just a few, share not only success, but also the same primary education at Montessori schools, where the freedom to express one’s own self without following pre-packaged programs and rules is an underlying principle.

The purpose of this blog is not to assess fields of education, but this peculiar common thread could convey something big: Their education may have helped those business leaders identify and, more importantly, put into effect, their very individual nature and talents, rather than fitting into a conventional behavioral mold. This could be one of the reasons they became great innovators with the ability to disrupt the status quo of global business from the ground up.

Millennials thumb their noses at traditional marketing segmentation

The above-mentioned tech innovators may just be the forerunners of a broader trend that has put the individual, with its natural propensities, acquired skills, and human contradictions, at the center of marketing and commerce decisions. Executing market segmentation has never been more difficult.

What criteria can one possibly use to segment a market where even the “nerd par excellence” Mark Zuckerberg is also a classic and Latin culture enthusiast, or where Apple hires Neapolitan philosophy graduates to develop its products? It seems that self-expression, cross-pollination between historically siloed skills, and some irreverence toward establishment act as common denominators not only of the tech elite, but also of the much-touted Generation Y—or millennials—as a whole. Just open your social media apps on your smartphone and you will witness live the increasing blurring of boundaries between professional and private identities.

Brands can unlock a huge market potential

To respond to those market changes, brands have made a dramatic shift in their marketing approaches. Long gone are the days of old-school, mass-advertising (according to a recent study by Elite Daily, only 1% of millennials say they are influenced in any way by advertising). Today, companies are running to win the complete race of personalized marketing.

Digitalization has provided consumers with tools—the smartphone above all—that empower them to access and research information freely, share it among new social aggregation schemes, and, when it comes to their behavior as consumers, actively design and rate their own shopping experiences. Today, engagement on social channels, crowdsourcing, and the design of individualized buying experiences are business imperatives that brands must embrace to stay in the game. It’s a game where a huge potential is at stake: millennials indeed act as trailblazers of much vaster groups of consumers who expect brands to address their growing personal requirements.

The dark side of individualization

Give consumers the exact experience they desire, where and when they want it. This ideal-sounding description hides some pitfalls which marketers should carefully monitor. The trend toward individualization in consumer behavior indeed reflects a more general tendency in (first-world) society – and not always a good one.

Provocative theories about individualization seem to multiply, such as the flip side of an excess of self-care, which may be a detriment to the sense of community, or no less, the lure of getting back to tribes. Caution is highly recommended, as the general sentiment about individualization may change quickly. Aside from these apocalyptic scenarios, if marketers keep in mind only one warning, it would be this: Use your customer data wisely.

As my colleague Johann Wrede puts it in spot-on words, beware of “the creepy factor of marketing” and ask yourselves: How do you use customers’ personal information without it feeling like a violation of their privacy? To deliver individualized customer experiences, you need to know what to do with your customer data to keep them engaged.

How to make the best personalized marketing decisions

Individualization may therefore be a double-edge sword, but by making the right decisions you can actually have your cake and eat it, too. In more decorous business words, you can offer contextual, individualized experiences to your customers while respecting their “individual propensity to individualization.”

Here are three fundamental principles behind any successful strategy to market to an “audience of one:”

  1. Consolidate customer profiles across the enterprise: Data is the fuel to develop your personalization strategy. Capture rich customer information, with a special focus on online behavior data, consolidate it across the enterprise, and you will be able to identify and treat your customers as individuals.
  1. Capture your customer intents in real time: To access and evaluate customer intents in real time, you need to leverage both explicit and implicit consumer behavior. Sophisticated micro-segmentation capabilities are a must, but the ongoing management of customer communities, or the identification of hidden trends through predictive analysis, will enable you to access and evaluate your customer’s intents better than your competitors.
  1. Respond to customer opportunities with speed and agility: Deliver in-the-moment, personalized, and relevant experiences across all touchpoints, channels, devices, and departments. For example capture your customer’s interest at the store, follow up with targeted ads, personalize their view of the website, and not least, send them dynamic product recommendations in a remarketing email.

Engaged customers are loyal customers

By all accounts, it looks like brand loyalty is growing again, especially among the highest-potential group of consumers today: millennials. Marketers who haven’t gotten their personalization strategies right yet should do so now, because the next frontier of marketing is already in sight, and it is called “empathy marketing”—the ability to create a personal connection with every individual consumer. Solutions and tools that enable companies to establish genuine conversations and engage with their customers on social channels do exist.

Empathize, but don’t be creepy. Reach this delicate balance and you’re on track to win the prize at the end of the individualization game: customer loyalty.

For more insight on personalized marketing, see Engage At Scale: Leveraging Customer Micro-Moments.

Erica Vialardi

About Erica Vialardi

Erica Vialardi is the EMEA Audience Engagement Marketing Manager at SAP Hybris.